Triumph or Defeat? First Settlement Reached in Rx Pricing Suit

Triumph or Defeat? First Settlement Reached in Rx Pricing Suit

Article excerpt

A nationwide class action suit by retail pharmacists charging manufacturers with discriminatory pricing has produced its first settlement. The Purdue Frederick Co. is getting out of the suit for $1.4 million in a settlement that includes no admission of wrongdoing by the company and no injunction against future price discrimination. Another 17 drug manufacturers and distributors are set to go to trial in April.

"Pharmacists have a very compelling story to tell," said Chicago attorney Michael Freed, one of four lead lawyers representing the class. "The retail pharmacy, by and large, has never been given a trade discount, unlike almost every other class of trade in this industry."

The settlement has publicly pitted the pharmacists against their own legal team. The San Francisco-based Pharmacy Defense Fund (PDF), whose 1993 price discrimination suits sparked the class action, and the Pharmacy Freedom Fund (PFF), which launched its own salvo of pricing suits from Fort Worth, Texas, both objected to the settlement. So did more than 2,000 individual pharmacists, who submitted written objections to U.S. District Court Judge Charles Kocoras in Chicago.

The entire $1.4 million will be used to pay litigation expenses racked up by the attorneys, complained PFF president Bob Gude. Freed and other class attorneys have reportedly spent about $250,000 in out-of pocket expenses.

"I'm trying to stay optimistic," Gude said. "I'm hoping this doesn't turn into another Ford Bronco kind of case, where the lawyers got millions of dollars and the plaintiffs each got a safety manual and a new flashlight. …